The Online Library of Liberty

A project of Liberty Fund, Inc.

• Editor’s Foreword
• Preface to the First Edition
• Preface to the 1962 Edition
• Bureaucracy
• Introduction
• 1.: The Opprobrious Connotation of the Term Bureaucracy
• 2.: The American Citizen’s Indictment of Bureaucratism
• 3.: The “progressives’” View of Bureaucratism
• 4.: Bureaucratism and Totalitarianism
• 5.: The Alternative: Profit Management Or Bureaucratic Management
• I: Profit Management
• 1.: The Operation of the Market Mechanism
• 2.: Economic Calculation
• 3.: Management Under the Profit System
• 4.: Personnel Management Under an Unhampered Labor Market
• II: Bureaucratic Management
• 1.: Bureaucracy Under Despotic Government
• 2.: Bureaucracy Within a Democracy
• 3.: The Essential Features of Bureaucratic Management
• 4.: The Crux of Bureaucratic Management
• 5.: Bureaucratic Personnel Management
• III: Bureaucratic Management of Publicly Owned Enterprises
• 1.: The Impracticability of Government All-round Control
• 2.: Public Enterprise Within a Market Economy
• IV: Bureaucratic Management of Private Enterprises
• 1.: How Government Interference and the Impairment of the Profit Motive Drive Business Toward Bureaucratization
• 2.: Interference With the Height of Profit
• 3.: Interference With the Choice of Personnel
• 4.: Unlimited Dependence On the Discretion of Government Bureaus
• V: The Social and Political Implications of Bureaucratization
• 1.: The Philosophy of Bureaucratism
• 2.: Bureaucratic Complacency
• 3.: The Bureaucrat As a Voter
• 4.: The Bureaucratization of the Mind
• 5.: Who Should Be the Master?
• VI: The Psychological Consequences of Bureaucratization
• 1.: The German Youth Movement
• 2.: The Fate of the Rising Generation Within a Bureaucratic Environment
• 3.: Authoritarian Guardianship and Progress
• 4.: The Selection of the Dictator
• 5.: The Vanishing of the Critical Sense
• VII: Is There Any Remedy Available?
• 1.: Past Failures
• 2.: Economics Versus Planning and Totalitarianism
• 3.: The Plain Citizen Versus the Professional Propagandist of Bureaucratization
• Conclusion

1.

Past Failures

We must acknowledge the fact that hitherto all endeavors to stop the further advance of bureaucratization and socialization have been in vain. In the twenty-seven years that have passed since President Wilson led America into the war to make the world safe for democracy, democracy has lost more and more ground. Despotism triumphs in most of the European countries. Even America has adopted policies which, some decades ago, it disparaged as “Prussian.” Mankind is manifestly moving toward totalitarianism. The rising generation yearns for full government control of every sphere of life.

Learned lawyers have published excellent treatises depicting the progressive substitution of administrative arbitrariness for the rule of law.1 They have told the story of how the undermining of self-government makes all the rights of the individual citizen disappear and results in a hyperdespotism of the oriental style. But the socialists do not care a whit for freedom and private initiative.

Neither have satirical books been more successful than the ponderous tomes of the lawyers. Some of the most eminent writers of the nineteenth century—Balzac, Dickens, Gogol, Maupassant, Courteline—have struck devastating blows against bureaucratism. Aldous Huxley was even courageous enough to make socialism’s dreamed paradise the target of his sardonic irony. The public was delighted. But his readers rushed nonetheless to apply for jobs with the government.

Some people like to make fun of especially extravagant features of bureaucracy. It is indeed curious that the government of the world’s most powerful and richest nation runs an office—the Bureau of Home Economics of the United States Department of Agriculture—one of the tasks of which is to design trousers “for the very small child who is just learning to dress himself.” But for many of our contemporaries there is nothing ridiculous in this. They aim at a mode of government under which the production of hose, underwear, and all other useful things should be a task of the authorities.

All learned criticisms and witty satires are of no avail because they do not hit the core of the problem. Bureaucratization is only a particular feature of socialization. The main matter is: Capitalism or Socialism? Which?

The supporters of socialism contend that capitalism is an unfair system of exploitation, that it is extremely detrimental to the welfare of the masses and that it results in misery, degradation, and progressive pauperization of the immense majority. On the other hand, they depict their socialist utopia as a promised land of milk and honey in which everybody will be happy and rich. Are they right or are they wrong? This is the question.

[1. ]It may suffice to quote two of the most brilliant books of this class: The New Despotism by Lord Hewart of Bury, Lord Chief Justice of England (New York, 1929), and Our Wonderland of Bureaucracy by James M. Beck, former Solicitor General of the United States (New York, 1932). It is noteworthy that the latter book was published before the inauguration of the New Deal.